Years ago we were more entertained by our government's actions because we were younger then and not threatened so much by their policy decisions. But now as we approach retirement age, we are becoming simply enraged and disgusted by the decisions made in Washington.
First, there is no question that older Americans on fixed income are having a hard time finding the money to buy steak or live, as they say, "high on the hog", where you find the better cuts of meat. Now it turns out that the US Department of Agriculture has approved a 'pink slime' additive to ground beef. Pink slime which is a major ingredient of dog food is not beef but a salvage product rendered from fat waste trimmings and intestines still full of you know what. This rendered slime is treated with ammonia to kill the bacteria one finds in fecal matter, and 70 percent of ground beef at supermarkets contain it. It's the new hamburger helper direct from the US Department of Agriculture. We checked some cookbooks including those of Julia Child, Emeril Lagasse, Martha Stewart, Lydia, Rachael Ray, etc., and have yet to find one recipe calling for "pouring in a cup of ammonia while adding two cups of pink slime"........
The purpose of using this ingredient is to make big bucks for meat processors and to lower the cost of hamburger. The government is delighted because it puts a lid on the price of hamburger and helps to keep the consumer price index down. Keeping the consumer price index suppressed is, of course, viewed as critical to the national interest. Pink slime is big business and there is just no way to police its use at restaurants where local operators are just out to sell a burger and make a buck. Indeed, selling "yuck for bucks" just seems to epitomize the American ethic today.
In addition to helping to keep the supply of red meat up and the prices down, Congress recently lifted a ban on funding horse meat inspectors, so now the USDA can help turn race horses and ponies into horse burgers and sausage for gramps. While it may sound disgusting to Americans, horse meat is sold as a delicacy and devoured in foreign countries along with cats, dogs, chickens, ducks, grasshoppers and lizards, which are all grilled and gobbled down. In Arab countries, dogs are particularly scarce as they are on the menu. So, as America becomes more international and less developed, in order to feed our poor people and retirees, it may only be a matter of time before you need to keep an eye on Rover, or he will end up as skewered shish-kabob on your neighbor's grill.
When it comes to securities and investing, our government can be just as uncaring. "The Jumpstart Our Business Startups ACT (the JOBS Act), which proponents says will make it easier for small businesses to launch initial public offerings, solicit new investors, and, eventually, hire more workers is likely to pass the Senate, and will probably be signed by the President as early as the end of March. This new law is designed to gut accounting oversight on mid-sized IPOs and relax restrictions and allow both the sale and advertising of unregistered securities so that new firms can raise capital. The idea is that sales of Reg D securities, now limited to $5 million dollars, should be lifted to $50 million dollars before requiring SEC registration. Skipping SEC registration means that the nuisance of having corporations report honest audited financial results can be dispensed with. The talking heads on TV keep telling us that we need to unleash capitalism's energy and animal spirits as the economy has been held back by too much regulation and the horrible burden of reporting fair and accurate financial data. But if this investment plan goes through, we know what's going to happen.
Based on history, particularly the dot com disaster, and the mortgage and housing bust, investors are about to be legally robbed. Securities sales organizations will spring up hiring used car salesmen, recent sub-prime mortgage salesmen, and new college grads that know nothing and will promise anything in order to sell unregistered securities. Why? These offering will pay the salesmen fat commissions of 10 to 15 percent of the money raised. Having grown up in Wisconsin dairy country we know horse hockey when we smell it, and slime when we see it. Having spent 30 years on Wall Street, we know how this story plays out. Indeed, if Goldman Sachs and Citibank creating bad mortgage securities to profit from by selling them to suckers is still fresh in your memory you should know how this story ends: Pay a salesman a big fat commission and they'll say and sell anything to make a fast buck.
Those targeted by these investment scammers selling slimy securities will certainly be the older Americans who survived the last two bubbles, but are getting zero interest at the bank. Retirees can't live on zero interest so they are ripe to be sold hope and Ponzi-style investments that pay them interest with their own money until the principal is gone. They should consider renaming the JOBS Act to "The Jokingly Obscene BS Securities ACT" which I think describes it better.
The coming flood of horse hockey investments sold by boiler rooms would make Bernie Madoff proud because now they will be perfectly legal. Meanwhile, we have decided not to get suckered in. We will keep some cash in the bank for a rainy day and most of our real money in physical gold and silver. Gold remains the one investment immune to pink slime disease. We would rather have gold coins or a pile of silver than be faced with the sudden death of wealth the greedy can suffer by buying heavily touted but hollow investments. It's a sad day when the American Congress sanctions securities that are designed to rob investors and line the pockets of the promoters in an effort to create the illusion of jobs to win an election.